A number of banks, including State-owned establishments, are transferring non-performing loans to asset management companies, the 21st Century Business Herald reported.

The transfers will be completed by the end of the third quarter, an employee of an asset management company told the newspaper.

A bank based in north China has launched a bid to offload its 747 million yuan ($122 million) bad loans to one of the top four AMCs in the country, the newspaper reported.

The package involves 68 debtors, 674 million yuan in capital and 24 million yuan in interest and default interest from six branches in Beijing, Tianjin, Shanghai and Hangzhou.

Most of the non-performing loans to be transferred stem from small and medium enterprises, particularly those in Jiangsu and Zhejiang provinces.

Zhejiang branches of Industrial and Commercial Bank of China Ltd, the Agricultural Bank of China, Bank of China, Bank of Communications and others are talking to major asset management companies about transferring non-performing loans involving more than 60 packages and 400 to 500 enterprises. Some of these banks have already completed the deal.

Non-performing loans in commercial banks have been on the rise for seven consecutive months, amounting to 539.5 billion yuan by the end of the second quarter, up 46.7 billion yuan from the end of 2012.

The banks are moving tentatively at present, but a wave of transfers may be around the corner, the newspaper reported.